Innovating Business Processes for Profit

Many years ago I project managed a ‘downsizing’ for the company I worked for. Over a hundred people found they had lost their jobs by the time the project was completed. How were these unfortunate people picked? Essentially the senior managers met in a room and nominated those who would go, without proof they were the right people, without any form of analysis of work. I do give credit to the experiential judgement which many senior managers exhibit, so perhaps the right people were picked, but the result of this exercise was that over the next year or so contractors and new employees were brought in to fill resource gaps and other employees worked excessive hours – because the amount of work had not decreased. By the end of the year I was convinced there had to be a better way for an organisation to determine the right resourcing for the work it had to do and it had to find better ways of doing the work so that less people were needed. If that were possible we would have avoided employing supposedly too many people in the first place and consequently avoided the misery of downsizing. What was needed was a method of finding the best work methods and the right numbers of people with the right skills to undertake that work. And we had to be able to prove we had the right numbers to resist arbitrary cost-cutting exercises, although such macho decisions will undoubtedly continue to be made in some cultures. I carried on in senior management roles and learned much about what it meant to own business goals, strategies and problems. I did ‘enterprise transformation’ work and discovered that processes were behind all work undertaken by any enterprise. That seems obvious but typically organisations did not actually think that way. At that time there were Quality Departments that defined processes, but they were typically working at far too low a level to interest senior management and so were disconnected from strategic thinking. I worked on major processes. The organisation I worked for was spending large amounts of money on bidding for large contracts and the number of wins was that low that the organisation was considering ways of avoiding such bids. What it really needed to do was avoid unsuccessful bids but it was in danger of reducing good bids as well. So we worked on the bid process and people got excited by what we did. The result was less bids and just as many wins, so we avoided spending a lot of money. The key to this success was working at a high enough level that stakeholder business managers could identify with what was going on, and consequently produce really clever ideas for redefining the process. This was process innovation, not just improvement. And so I learned to differentiate between the business activity level, which business stakeholders could easily relate to, and the task or procedural level, which was really only of interest to the people who did each of the specific tasks - and at the task level few people took an interest (or were encouraged to take an interest) in the whole process. Process innovation is done at the activity level, further improvements are made later at the task level when procedures are defined but the benefits of process innovation, in terms of improved customer service and resource savings, are much more important than the benefits of the improvements.